*Please clealy inidcate with answer is for part A and which is for part B.* Simp
ID: 2397031 • Letter: #
Question
*Please clealy inidcate with answer is for part A and which is for part B.*
Simpson is a single individual who is employed full-time by Duff Corporation. This year Simpson reports AGI of $51,000 and has incurred the following medical expenses:
a. Calculate the amount of medical expenses that will be included with Simpson's itemized deductions after any applicable limitations.
b. Suppose that Simpson was reimbursed for $760 of the physician's charges and $1,650 for the hospital costs. Calculate the amount of medical expenses that will be included with Simpson’s itemized deductions after any applicable limitations.
Dentist charges $ 1,680 Physician's charges 2,310 Optical charges 720 Cost of eyeglasses 640 Hospital charges 3,000 Prescription drugs 365 Over-the-counter drugs 705 Medical insurance premiums (not through an exchange) 975Explanation / Answer
Part A
All expenses are qualified medical expenses expect for the over-the-counter drugs. Hence, Simpson's medical expense deduction is 9690 less 5100 (10%*51000)= 4590 and this amount is included with Simpson's other itemized deductions
Part B
Simpson's medical expenses are reduced by reimbursements 9690 less 2410 and then reduced by floor limit 5100 (10%*51000) = 2180 and this amount is included with Simpson's other itemized deductions.
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